Sales Tax Calculator: State Rates, Formulas & Exemptions in 2026
Quick Answer
- *Sales tax formula: Tax Amount = Price × (Tax Rate / 100). On a $100 item at 8%: $100 × 0.08 = $8.00 tax, total $108.00.
- *5 states have no sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon.
- *Louisiana has the highest combined state + local rate at ~9.56% (Tax Foundation, 2025).
- *Prescription drugs are exempt in all 50 states. Groceries and clothing exemptions vary widely by state.
What Is Sales Tax?
Sales tax is a consumption tax imposed by state and local governments on the sale of goods and certain services. When you buy something at a store or online, the retailer collects sales tax on behalf of the government and remits it periodically. The buyer pays it, the seller collects it.
According to the U.S. Census Bureau, state and local governments collected over $560 billionin sales and gross receipts taxes in fiscal year 2022 — making it one of the largest revenue sources for state budgets, second only to individual income taxes.
Unlike the federal government, which has no national sales tax, the U.S. leaves sales tax entirely to the states. That creates a patchwork of 45 different state systems (plus D.C.), each with its own base rate, local add-ons, and exemption rules.
The Sales Tax Formula
The math is straightforward:
Tax Amount = Price × (Tax Rate / 100)
Total Price = Price + Tax Amount
Or combined into a single step:
Total Price = Price × (1 + Tax Rate / 100)
Examples
| Item Price | Tax Rate | Tax Amount | Total |
|---|---|---|---|
| $25.00 | 6% | $1.50 | $26.50 |
| $100.00 | 8.25% | $8.25 | $108.25 |
| $499.99 | 9.5% | $47.50 | $547.49 |
| $1,200.00 | 10.25% | $123.00 | $1,323.00 |
You don't need to memorize the formula. Our sales tax calculatorhandles it instantly — enter the price and rate, and it outputs the tax amount and final total.
States With No Sales Tax
Five U.S. states impose no statewide sales tax:
| State | Statewide Rate | Local Tax Allowed? |
|---|---|---|
| Alaska | 0% | Yes — some cities/boroughs charge up to 7% |
| Delaware | 0% | No |
| Montana | 0% | No (resort areas may charge small fees) |
| New Hampshire | 0% | No |
| Oregon | 0% | No |
If you're considering a major purchase — electronics, appliances, a vehicle — buying in a no-sales-tax state can save you hundreds. On a $5,000 purchase in a state with 9% tax, that's $450 back in your pocket.
Highest Combined State + Local Sales Tax Rates
Combined rates include the state base rate plus the average local add-on. Data from the Tax Foundation's 2025 State Business Tax Climate Index:
| State | State Rate | Avg. Local Rate | Combined Rate |
|---|---|---|---|
| Louisiana | 4.45% | 5.11% | 9.56% |
| Tennessee | 7.00% | 2.55% | 9.55% |
| Arkansas | 6.50% | 2.95% | 9.45% |
| Washington | 6.50% | 2.67% | 9.17% |
| Alabama | 4.00% | 5.10% | 9.10% |
| Oklahoma | 4.50% | 4.44% | 8.94% |
| Illinois | 6.25% | 2.49% | 8.74% |
| Kansas | 6.50% | 2.22% | 8.72% |
Note that local rates vary significantly within a state. In Louisiana, some parishes charge combined rates above 12%. In cities like Chicago, the combined city + county + state rate can reach 10.25%.
5 Things That Are Often Sales Tax Exempt
Most states carve out exemptions for necessities. Here are the most common, ranked by how widely they're exempted:
1. Prescription Drugs
Prescription medications are exempt from sales tax in all 50 states and D.C. This is the most universal exemption in American tax law. Over-the-counter drugs are a different story — some states tax them, others don't.
2. Groceries (Unprepared Food)
About 13 states fully exempt groceries. Another handful tax them at a reduced rate (Illinois charges 1%, Virginia charges 2.5%). The key distinction is “unprepared” food — ingredients you take home and cook. Restaurant meals and hot prepared food are almost always taxable.
3. Clothing (Select States)
Pennsylvania, New Jersey, New York (under $110 per item), Minnesota, and a few others exempt most clothing purchases. New York's threshold means a $95 shirt is tax-free but a $150 coat is taxable. The logic: clothing is a necessity.
4. Medical Equipment and Devices
Durable medical equipment — wheelchairs, crutches, blood pressure monitors, CPAP machines — is exempt in most states when prescribed by a physician. Non-prescription items like reading glasses may or may not qualify depending on state law.
5. Agricultural Supplies
Seeds, fertilizer, livestock feed, and farm equipment are commonly exempt in agricultural states. The rationale is that taxing inputs to food production would ultimately raise food prices for consumers.
How Reverse Sales Tax Calculation Works
Sometimes you know the final price (tax included) and need to figure out the pre-tax price or exactly how much tax was charged. This is called a reverse sales tax calculation.
Pre-Tax Price = Total Price ÷ (1 + Tax Rate / 100)
Tax Amount = Total Price − Pre-Tax Price
Example
Your receipt shows $108.25. You know the sales tax rate was 8.25%. What was the original price?
Pre-Tax Price = $108.25 ÷ (1 + 0.0825) = $108.25 ÷ 1.0825 = $100.00
Tax Amount = $108.25 − $100.00 = $8.25
This is useful for expense tracking, accounting, and verifying that a retailer charged the correct rate. Our sales tax calculator includes a reverse calculation mode.
State vs. Local Sales Tax: What's the Difference?
Your total sales tax rate is usually a combination of:
- State rate: Set by the state legislature, applies uniformly statewide (e.g., California's base rate is 6%)
- County rate: Added by the county government (e.g., Los Angeles County adds 0.25%)
- City rate: Added by the city (e.g., the City of Los Angeles adds 1.25%)
- Special district rate: Transit districts, stadium authorities, and other special purpose entities may add small amounts
In California, for example, the statewide base rate is 7.25% (including a mandatory 1% county add-on), but local add-ons push the actual rate in many cities to 9-10.25%. The California Department of Tax and Fee Administration publishes an updated rate lookup tool.
Online Sales Tax: What Changed After South Dakota v. Wayfair
Before June 2018, online retailers only had to collect sales tax in states where they had a physical presence. The Supreme Court's decision in South Dakota v. Wayfair, Inc. changed everything.
Now, states can require out-of-state sellers to collect sales tax based on economic nexus— typically $100,000 in sales or 200 transactions in a state per year. As of 2025, all 45 states with a sales tax have enacted economic nexus laws.
For consumers, this means most online purchases are now taxed the same as in-store purchases. For small businesses selling online, tracking nexus in multiple states has become a significant compliance burden. Tools like Avalara and TaxJar automate this, but costs add up fast.
How Sales Tax Affects Your Take-Home Pay Math
Sales tax is a hidden cost of living. If you earn $60,000 and live in a state with no income tax but a 9% average sales tax rate, a significant portion of every dollar spent goes to the state. Compare this to a state with a 5% income tax and 4% sales tax — the total tax burden may be similar, just structured differently.
When comparing jobs in different states, factor in the full tax picture. See our take-home pay vs. gross pay guide for a complete breakdown of how state taxes affect your real earnings. You can also use our take-home pay calculator to model the difference.
For quick percentage math in other contexts, our percentage calculator handles any percent-of-a-number calculation. And when splitting a bill after tax, our tip calculatorcan help you divide the total — tip included — evenly.
Sales Tax for Businesses: Nexus, Registration, and Filing
If you sell goods or taxable services, you're responsible for:
- Determining nexus: Where do you have physical or economic presence?
- Registering: Obtain a seller's permit in each state where you have nexus
- Collecting: Charge the correct rate based on the buyer's location (destination-based states) or your location (origin-based states)
- Remitting: File and pay collected taxes on the required schedule (monthly, quarterly, or annually depending on volume)
Most states use destination-based sourcing, meaning you charge the rate at the buyer's address. A handful of states — including Arizona, Illinois, Mississippi, Missouri, New Mexico, Ohio, Pennsylvania, Tennessee, Texas, Utah, and Virginia — use origin-based sourcing for in-state sellers.
Calculate sales tax for any price and rate
Try our free Sales Tax Calculator →Need to calculate your paycheck after all deductions? Try our take-home pay guide
Frequently Asked Questions
How do I calculate sales tax?
Multiply the pre-tax price by the sales tax rate expressed as a decimal. For example, a $50 item with an 8% sales tax rate: $50 × 0.08 = $4.00 tax, so the total is $54.00. You can also use the formula: Tax Amount = Price × (Tax Rate / 100).
Which states have no sales tax?
Five states have no statewide sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon. However, Alaska allows local jurisdictions to impose their own sales taxes, so some Alaskan cities and counties do charge sales tax. The other four states have no local sales taxes either.
What is the highest sales tax rate in the US?
Louisiana has the highest average combined state and local sales tax rate at approximately 9.56%, according to the Tax Foundation. Tennessee (9.55%) and Arkansas (9.45%) follow closely. The highest individual local rates can push combined rates above 12% in some jurisdictions.
Are groceries subject to sales tax?
It depends on the state. About 13 states fully exempt groceries from sales tax, while others tax them at a reduced rate. States like Illinois charge 1% on groceries vs. the full 6.25% general rate. Prepared food — like restaurant meals or hot deli items — is almost always taxable everywhere.
How do I calculate the pre-tax price from a total that includes tax?
Divide the total price by (1 + the tax rate as a decimal). For a $54 total with 8% tax: $54 ÷ 1.08 = $50.00 pre-tax price. This reverse sales tax formula is useful when you know the final price and need to find the original price or the tax amount separately.
Are prescription drugs taxed?
Prescription drugs are exempt from sales tax in all 50 states and the District of Columbia. Over-the-counter medications are treated differently by state — some states exempt them too, while others tax them at the full rate. Always check your state revenue department for current rules.